The economic climate

It seems lately the world is under great economic pressure. And it stems from the american problem of people not being able to pay their mortgages. Banks for too long had been willing to fork out money to people with little basis of proof to pay the debts back. And now that a lot of these motgages are being foreclosed, the lenders are feeling the pinch. The current situation is dyer. If these banks go bust, then a lot of people will suffer, but because the minority of people cannot make the the repayments, theres seems little hope that the banks will stay alfoat. So the solution seems to be for the american government to "invest"700 billion dollars into the struglling financial sectors to keep their heads above water until the climate passes. My problem is that why have these industrys let themselves to teeter on the edge of a cliff when they had a good clear view of the drop before them. 6 month ago we saw on the news obout the "sub prime mortgage problem" and yet i'm sure in those same 6 months millions of dollars where lent to individuals unable to make their repayments. Is it the taxpayers problem that a bank faulters?The ceo of any main bank is earnings millions of dollars to run his ship successfully, but where are these people now, you here about companys going under, but it seems no one is held responsible for the mess. There are 2 reasons for a bank going broke. One of course is unpaid mortgages, But when it comes down to the bottom line for profit, surely you would just stop giving out money to every tom dick and harry who asked for it when the statistics showed a problem arising. The second is the stock market. Banks take your money and invest it, and the majority of the time make a lot of profit. For the last few years i've heard the banks and mining sector making "record profits" on the stock exchange and also in everyday buisness. Then one day theres a major drop and thay dont have a leg to stand on. The paralel can be shown with a gambler. Race after race you might win, but it only takes a few unlucky moments to drop a lot of money fast, then you panic and make rash desicions to recoup the lost money, but you've taken 5 steps forward and 7 steps back. Then you loose faith and try and spread your money to make some kind of profit, but by spreading your capital you can only profit minimally, and the risk of lose is still there.

The other issue is with superanuation. The current trend {like a bank} is to take your hard earned money and invest it. So basiclly it's like giving your super to a stranger and hoping they will turn a profit. For most young people it's not of concern, because they wont be acessing the money for years, but what if you had planned to take your super out today in a lump sum. A month ago it might have been worth 300 000, but now your super company would just say

" Sorry, with the current climate your super is only worth 200 000."

A good friend of mine used to be involved heavilly with stocks {stock broker/banker} and saw the best and worst of the trade. It was common place for suicides and depression to occur, when someone took a "sure tip" and then found out they had lost their familys entire inheritance. Is it really fair to have an industry where peoples lively hoods can dissapear before their eyes? Of course it is, there are numerous industries where it ocuurs. Gambling, alchohol, tobacco, are all legal yet if you get yourself in trouble with them, no ones going to fork out 700 billion dollars to pull those people out of dept. The individuals are allowed to suffer but the conpanys harvesting their souls will be rescued if need be to keep them offending. In a time of crisis and fianacial doom, it hasn't stopped credit card companys from sending out their letters of approval, even so called current affair television shows who supposebly are fighting for the rights of the little aussie battler are promoting the new david jones credit card like it's gods gift to humans. You sexy it up with a super model and a glamouress party, but you forget it's just another way for people to get themselves in dept. { even alan jones the puppet freely promoted and advertised the phone number for people to sign up to it}

There is certainly an issue with big companys making big profits, and then falling out of the sky with even the slightest of economic trouble. Ceo's do not have nostradamus as their middle names, but surely they saw it coming, and should have plan b's if such things occur, Because it's not only the lenders who are self destructing, but they take with them the lendee's, the construction sector, the retailers, the employees and now it seems they take the taxpayers with them aswell.